Boston Scientific Ordered to Pay $100 Million Over Mesh

byJef Feeley11:31 PM HKT
May 28, 2015Boston Scientific Corp. must pay $100 million to a Delaware woman who blamed the company’s vaginal-mesh inserts for leaving her in constant pain and unable to have sex, in the first verdict after the company agreed to begin settling cases over the devices, and the biggest yet.

A state-court jury in Delaware found Thursday that Boston Scientific’s Pinnacle and Advantage Fit inserts, built to buttress sagging organs and treat incontinence in women, were defectively designed and company executives hid the flaws from Deborah Barba.

The 51-year-old former bank teller contends the inserts eroded once they were implanted, leaving her with a scarred vagina and a host of medical problems.

The jury also found Boston Scientific engaged in fraud by failing to alert doctors to the devices’ faulty design. It awarded $25 million in compensatory damages and hit the company with a $75 million punitive-damages award.

The verdict is the largest so far against Boston Scientific over its vaginal-mesh inserts, eclipsing a $73 million award last year to a Texas woman over the company’s Obtryx sling. It ranks eighth among U.S. jury verdicts in 2015, according to data compiled by Bloomberg.

It’s the first since Marlborough, Massachusetts-based Boston Scientific agreed last month to pay $119 million to resolve about 3,000 lawsuits over the devices in the first settlements of claims that the inserts damaged women’s organs and made sexual intercourse painful.

Appeal Planned

Kelly Leadem, a Boston Scientific spokeswoman, said the company disputes the conclusion that the inserts were flawed and caused Barba’s injuries.

“We disagree with the jury’s finding and intend to appeal based on the strength of our evidence,” she said in an e-mail.

The verdict is surprising because it came in Delaware, the most corporate-friendly state in the nation, Erik Gordon, a professor at the University of Michigan’s business and law schools who teaches classes on how drugs and medical devices are developed and regulated, said by e-mail.

“Corporation-friendly Delaware juries rarely award punitive damages,” Gordon said. “A good portion of Delaware’s economy is driven by its business of domiciling most of the country’s largest corporations.”

Delaware, the corporate home to more than half of the U.S.’s publicly traded companies and 63 percent of Fortune 500 firms, had more than 1 million legal entities incorporated in the 900,000-resident state by 2012, officials said.

‘Loudly, Clearly’

“The jury spoke loudly and clearly that Boston Scientific’s defective devices injured Mrs. Barba and many other women and they should step and take responsibility for causing that harm,” said Fred Thompson, one of her lawyers.

The U.S. Food and Drug Administration ordered Boston Scientific, Johnson & Johnson and more than 30 other vaginal-implant makers in 2012 to study rates of organ damage and complications linked to the devices after the companies faced a wave of lawsuits over them.

Women such as Barba allege that inserts produced by Boston Scientific and other companies are made of substandard materials and shrink once they are implanted, causing organ damage and persistent pain. J&J moved in June 2012 to pull four lines of inserts off the market.

Many of the more than 70,000 mesh-insert cases have been consolidated before U.S. District Judge Joseph Goodwin in Charleston, West Virginia. Others have been filed in state courts in Delaware, New Jersey, Missouri, Texas and California.

Settlement Talks

Goodwin has been pushing manufacturers to consider settling the cases before they face billions in jury awards.

Boston Scientific, C.R. Bard Inc. and other makers of vaginal inserts had talks two years ago about creating a global settlement of cases over the devices, according to people familiar with the discussions. J&J, which refused to participate in 2013 settlement talks, has now begun to settle some cases.

While Boston Scientific and Bard couldn’t agree on an overarching settlement program, both companies have begun to settle some individual suits and some lawyers’ inventories of cases.

Boston Scientific agreed to pay the $119 million to resolve nearly 3,000 cases collected by a group of plaintiffs’ lawyers led by Houston litigator David Matthews in April. The settlement provided an average payout of about $40,000 per case.

The company rose 37 cents, or 2 percent, to $18.36 at 3:26 p.m. in New York Stock Exchange composite trading.